The Ministry of New and Renewable Energy has outlined India’s strategy to expand small hydro power as part of the country’s shift towards clean energy. Speaking at an event in New Delhi, the Minister of State for New and Renewable Energy and Power stressed that this sector can help secure electricity supply, create jobs and support development in hilly and remote regions.
What India has and what it plans
India has identified more than 7,100 potential sites for small hydro power projects, with a total assessed capacity of around 21 GW. Currently, only about 5.2 GW of this potential has been developed, leaving significant room for growth.
The Government has announced a Small Hydro Power Development Scheme covering the years 2026-27 to 2030-31. The scheme will have a budget of Rs 2,584.60 crore and aims to build approximately 1,500 MW of new capacity. It will also support States in preparing detailed project reports for about 200 additional projects to create a pipeline for future work.
The Ministry highlighted that India has already crossed 300 GW of installed capacity from non-fossil sources. Small hydro power is seen as fitting well into this diversified energy mix because run-of-river projects can operate with less land use than large reservoir-based dams and can avoid displacing communities.
What this means for you
If you live in hilly or remote areas, small hydro projects could bring reliable electricity closer to your region while supporting local jobs and businesses. For investors and companies, this represents a growing sector with government backing and long-term policy support through 2030-31.
However, the scheme depends on faster approvals from environmental and forest agencies, and on making projects attractive to banks and investors by improving how they manage money flow over their lifetime. The Government has called for better coordination between central and state authorities to reduce delays in project clearances.